Executive Vice President and Chief Operating Officer at Devon Energy
Thanks, Rick, and good morning everyone. As Rick touched on, 2021 was a pivotal year for Devon that demonstrated the power of our asset portfolio and the capabilities of our talented organization. Across the portfolio, our team delivered results that exceeded production and capital efficiency targets, while continuing to drive down per unit operating costs and improving margins.
Results matter, and while we don't take any of these accomplishments lightly, I'm equally proud of the way that we were able to accomplish these financial metrics. Overcoming the challenges of the merger, pandemic and supply chain issues, we built a unified culture, took many best practices from both legacy companies and we're now poised for further leverage of those collective wins.
Now let's turn to Slide 14 and we'll see how 2022 capital plan is designed to build upon the momentum that we've established this past year. The first key point is there is no change to the upstream capital budget of $1.9 billion to $2.2 billion as we disclosed last quarter. While inflation is an absolute reality, our teams have done a good job of working with our service companies, mitigating escalations where we can and quantifying the remaining impact to our forecast. The great thing about a cyclical business is that if you're paying attention, you should have a pretty good idea of what the most critical things to focus on in anticipation of the next phase.
At this point in the cycle, we're focused on listening to our service company partners and helping them help us be successful. In this very tight supply chain market, the key phrase we hear is predictable and reliable. You will notice that our '22 program looks quite a bit like our '21 program. This is what has allowed us to telegraph to our service companies, midstream partners, and other key stakeholders to expect more of the same. That predictability allows them to plan their own supply chain work and the reliability allows them to know that we're going to do what we say we're going to do. Relationships are one of our core values at Devon and this listening and working with our critical partners is an example of that value in action. The relatively steady level of activity in '22 is projected to sustain our production throughout the year ranging from 570,000 Boe to 600,000 Boe per day.
Now let's turn to Slide 15 where we can discuss our Delaware Basin asset, which we believe is the most capitally-efficient resource in North America. During 2021, we had great success with our capital program that resulted in production growth rate of 34% compared to our first quarter '21. This high margin growth was driven by consistent execution and outstanding well productivity that was headlined by several memorable projects such as Danger Noodle, Boundary Raider and Thistle Cobra to name a few. Each of these prolific projects eclipsed 30 day rates of more than 5,000 Boe per day on a per well basis exhibiting the world-class reservoir potential that resides in the Delaware Basin.
It's important to note that strong volume performance in 2021 was paired with excellent capital efficiency and substantial additions to our proved reserves. While I would never point to a single year of reserves booking as the measure of success, with consistent and reasonable conservative booking processes, which we have, it can provide insight into the quality of the underlying assets. At year-end, our proved reserves in the Delaware increased 18% on a pro forma basis and these reserve additions replaced more than 200% of what we produced during the year. I find it especially impressive that our team added these reserves at an ultra-low F&D cost of only $5 per Boe. This result is just another example of how advantaged and sustainable are resources in the Delaware Basin.
Turning your attention to the map on the right, you can expect more of the same from us in 2022. We have a great slate of projects lined up to execute on, and once again, most of our program will consist of the high-impact opportunities focused on developing Upper Wolfcamp and Bone Spring zones and, to a lesser degree, the Avalon targets as well. To execute on this plan, we expect to run 14 rigs and four frac crews during the year. This capital activity will be diversified across our acreage footprint with sweet spots in Southern Lea and Eddy Counties and Stateline receiving most of the funding. Not only will this level of activity continue to grow Delaware production in '22, with the benefits of our operating scale and best practices from the merger integration, we are well-positioned to continue to improve our execution capabilities.
Let's turn to Slide 16 where we have displayed our strong track record of continuous improvement. As you can see on the slide, with the efficiencies captured in the Delaware, the team has essentially doubled the productivity of our rig and frac equipment compared to just a few years ago. The operational improvements have also meaningfully reduced our cost over time to about $550 per lateral foot in 2021, which competes very well with anyone out there. As I look ahead to '22, I expect our operational performance to continue to improve.
Our team consistently is identifying new ways to leverage technology, operational breakthroughs and industry best practices. Inflationary pressure and supply chain disruptions are a reality. Based on today's industry activity and commodity price projections, we've baked in around 15% higher costs than we saw in 2021. We have been and continue to be focused on consistency, planning and staying out in front ahead of these and reacting to any unforeseen issues. This work will be even more critical as the market continues to tighten.
On Slide 17. The next area I want to showcase is the momentum we're building in the Anadarko Basin, where we have a concentrated 300,000 net acre position in the liquids-rich window of the play. With the benefits of our $100 million Dow JV carry, we drilled over 30 wells in 2021 and commenced the first production on 16 of those wells during the year. As you can see on the charts on the right, the initial capital efficiency is excellent. With the benefit of state-of-the-art completion designs and appropriately up-spaced developments, per well capital cost have decreased by 25% versus legacy activity and well productivity to date has exceeded the type curve expectations by 35%. With the strong execution, the carried returns we're seeing from this activity will compete for capital with any asset in our portfolio. Given the success, we've elected to step up activity in the Anadarko Basin to three rigs in '22. This program will result in around 40 new wells coming online in 2022, allowing us to maintain steady production profile throughout the year and harvest significant amounts of free cash flow.
Now let's turn to Slide 18 and I'll cover a few points on the other assets that are creating huge value while flying under the radar. Collectively, these assets generated more than $1 billion of free cash flow in 2021 and we are on pace to produce a similar amount of free cash flow in '22. Williston remains some of the best returns in our portfolio. The team is continuing to unlock additional locations and has leveraged company best practices to significantly improve our ESG footprint. Our Eagle Ford asset continues to deliver solid returns. The team is doing some very exciting work to unlock additional locations and a very significant refrac potential. The Powder is the basin with the most upside yet to unlock. Our team is making great progress in that regard by driving laterals longer to three miles and rebooting the stimulation design. We're seeing very encouraging well results. I'm proud of what these assets are delivering and I appreciate the team's hard work and effort that goes into fulfilling this important role within our portfolio.
Finally, let's turn to Slide 19 where I'm excited to share some of our progress on the ESG front. As many of you are aware, we set aggressive emissions reductions targets last year that covered a myriad of near, mid and long-term priorities. In addition to our -- to ensure organizational alignment, we directly tied progress on these targets to our annual compensation program. We've also dedicated a Board Committee to engage in our ESG goal setting process, performance and reporting. Since the announcement of these environmental targets, we've taken immediate action to and delivered results. We do not have finalized figures yet for this past year, but I can tell you our Scope 1 & 2 GHG emissions will improve roughly by 20% in 2021 versus our '19 baseline, well ahead of that stated -- the stated goals from this past summer.
Two of the key successes on reducing overall emissions is reducing methane emissions and reducing flaring. In 2020, we reduced methane emissions by 47% and we reduced flaring by 33%. I expect this positive rate of change to continue. Looking specifically at '22, we have many visible catalysts that will drive important results, such as advancements in leak detection technologies, improved facility design, facility retrofits, wide scale deployment of air-driven pneumatic controllers, and electrification of select field operations. I believe that it's also important to point out that these efforts are focused on changes that would not only improve our ESG metrics, but will also improve our overall operations. By focusing on these operational wins, we further align our organizational focus and excitement around ESG improvement.
And with that, I'll turn the call over to Jeff for the financial review. Jeff?